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AGENTS AND AGENCY                             I2g

The mere fact of delegation does not as a rule establish
any relationship between the principal and the sub-agent.
The sub-agent is responsible only to the agent who appointed
him, and the principal is not liable for the acts of the sub-
agent. This is so even where the agent has authority to
delegate. Where, however, the principal has definitely
accepted and agreed to the sub-agent who is appointed a
relationship may spring up directly between the principal
and the sub-agent (there is said to be privity of contract
between them), and in such a case the original agent drops
out and the sub-agent becomes in effect an agent.

The agent is not allowed to use any information which
he may obtain 'from one principal in carrying out his
duties with another principal That is, any confidential
information that is acquired whilst operating an agency
for one person may not be used in connection with any
agency with another. The use of experience and general
information is not debarred, but only such information as,
if used, might be detrimental to the principal from whom it
was acquired.

Under the Prevention of Corruption Act, 1906, an agent
may not receive any secret commission, or payment from
persons other than his principal. This is to prevent bribery
and corruption as a means of securing or influencing busi-
ness, and furthermore, should any agent be discovered to
have accepted any such payments, then he must hand the
sums received to his principal.

In effect, the agent is unable in the course of his duties to
earn more than the amount which is allowed to him under
his commission agreement. Any increase in profits brings
to him increase in commission, by which method he is
repaid if the agency flourishes under his guidance. Where,
for example, an agent receives goods for export at the
agreed selling price of ios., and he is able to dispose of the
articles at us., then the addition resulting from the in-
creased selling price must be credited to Ms principal,
irrespective of the fact that the principal would be satisfied
if he received onlv the los. desired.